Drug Company Whacked for $203 Million

JEFFERSON CITY, Mo. (CN) – Elan Corp. will pay $101 million to states and the federal government to settle claims of off-label marketing of its anti-epileptic drug Zonegran. Elan also must pay a $102 million criminal fine.

The $101 million settlement will reimburse Medicaid and Medicare. Missouri Attorney General Chris Koster said Missouri will receive $1.7 million. Elan encouraged pediatric neurologists to prescribe Zonegran, though it was not approved for patients younger than 16. It also pushed the drug to treat neuropathic pain, obesity, headaches and a variety of psychiatric conditions that were not approved by the Food and Drug Administration. Elan will also pay a $102 million criminal fine and has pleaded guilty to a federal misdemeanor of misbranding Zonegran through improper promotions. In a related settlement, Eisai Inc. agreed in principle to pay $11 million for its improper promotion of Zonegran after it acquired interests in the drug from Elan in April 2004. Doctors can prescribe drugs for off-label uses, but drug companies are not allowed to push the drugs for that.